The evolution of Electronic Data Interchange (EDI) standards and the evolution of Business-To-Business (B2B) connectivity processes are now four decades old. Most executives see the progress as slow and expensive. They are frustrated. They question the value. Companies want to power value networks. They want to connect with trading partners. They want to make the process both faster and easier. As a result, many are asking, “Does EDI use really matter? Is there value in the automation of B2B/EDI connectivity to power value networks?” Increasingly, companies are looking for the truth. This report attempts to answer these questions. Companies want to build value networks and connect with trading partners. In our work with manufacturing clients, we see that nine out of ten companies want to build a more effective end-to-end value network. There is a growing understanding that the enterprise-centric endeavors over the last decade have plateaued, and that there are significant costs and waste improvements to be had with the building of effective connectivity for the extended supply chain. However, most companies see EDI, and the exchange of documents through established protocols, as old- school processes. They are looking for “a better mousetrap.” In the last decade, many techniques evolved and they were overhyped. Early in the decade there were claims that XML was going to make EDI outdated. Similarly, the use of business portals and business networks, sometimes termed trading partner exchanges, were touted as better ways of improving trading partner connectivity. The promise was lower cost, faster onboarding, and greater partner penetration. However, today EDI is the predominate method for B2B connectivity. No company studied uses just one method for B2B connectivity. Connectivity between trading partners is usually a mix of portal, business network, and manual processes. While companies have invested in portals, trading exchanges, and automated business networks, the adoption is low. Portals are one-way communication. The use of portals is too passive and companies struggle to synchronize the many changes that occur in sales and purchase order processing through this passive form of connectivity. Likewise, the adoption of business networks in the establishment of B2B connectivity has been too slow. The networks require a mass of partners connected as a community, and this development has been too slow. Among the EDI/XML users surveyed for this report, EDI is used nearly six times more frequently in the connection of trading partners than portals, and eight times more frequently than the use of business networks (e.g., trading exchanges or specialized industry hubs). We also find that the process of sales order management is more mature, and better automated, than those of procurement. EDI/XML is the workhorse of the extended supply chain. Maturity in EDI/XML matters.

1. B2B Solutions Study
Summary Charts
June – September 2013

2. Agenda
Supply Chain Insights LLC Copyright © 2013, p. 2

3. Study Overview
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4. The Majority of Respondents Work at
Manufacturers and Average Revenue is $4 Billion
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5. Over Half of Respondents Work
in a Discrete Industry
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6. Half of Respondents Work in IT, Nearly Half Are
Managers and Over ¾ Work in the US
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7. Agenda
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8. Definitions
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9. All Respondents Have EDI/XML and Are
Somewhat Familiar with Their B2B Solutions
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10. Most Respondents Are Familiar with the Use of
EDI/XML for Order-to-Cash and Procure-to-Pay
Supply Chain Insights LLC Copyright © 2013, p. 10

11. Agenda
Supply Chain Insights LLC Copyright © 2013, p. 11

12. For Both Sales and Purchase Orders, Over Half
of Orders Are Exchanged via EDI/XML
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13. On Average, EDI/XML Sales Orders Are Shipped
Somewhat Faster with No Manual Intervention
Supply Chain Insights LLC Copyright © 2013, p. 13

14. For Both Sales and Purchase Orders, Over OneThird Report Tracking Internal Costs of Orders
Supply Chain Insights LLC Copyright © 2013, p. 14

15. Awareness of Internal Order Costs Is Low for
Both Order Types
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16. The Top Challenge for Orders Not Processed via
EDI/XML Is Added Time
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17. About Half Report the Orders Change at least
Once; About 60% Process Changes via EDI/XML
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18. The Top Challenge for Order Changes Not Using
EDI/XML Is Having More Imperfect Orders
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19. EDI/XML Benefits Accuracy Most for Both Sales
and Purchase Orders
Supply Chain Insights LLC Copyright © 2013, p. 19

20. Business Partner Relationships Is Top Supply
Chain Element to Improve with EDI/XML
Supply Chain Insights LLC Copyright © 2013, p. 20

21. ASNs and Purchase Order Acknowledgements
Are Most Important Elements of EDI/XML for
Improving Supply Chain Performance
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22. Non-Discrete Industries and Non-IT Roles Are
More Likely to Consider Purchase Order
Acknowledgements to be Important
Supply Chain Insights LLC Copyright © 2013, p. 22

23. Customer Order Captures and ASNs Are Top
Performing Elements of EDI/XML for Improving
Supply Chain Performance
Supply Chain Insights LLC Copyright © 2013, p. 23

24. Greatest Gaps in Performance:
ASNs and Purchase Order Acknowledgements
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25. Only 6% Report Offering a Discount to
Customers for Use of EDI/XML
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26. Open-Ended Comments about B2B Solution
Performance
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27. Open-Ended Comments about B2B Solution
Performance
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28. Agenda
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29. 82% of Respondents Are at least Slight Familiar
with Company’s Distribution Center
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30. Two-thirds Report Receiving Shipments without
Advanced Shipment Notices or Dispatch Advices
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31. Top Challenges When Don’t Have ASNs Are
Longer Receiving Times and Inability to Plan
Labor Schedules
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32. Without ASN, Biggest Impact to Supply Chain Is
Need to Expedite Shipments More Frequently
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33. On Average, Shipments without ASNs Cost $78
per Order Extra
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34. Nearly Half Report That Any of Their Inbound
Shipments Are Not Labeled with Barcodes
or RFID Tags
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35. On Average, Shipments without Barcodes or
RFID Tags Cost $57 per Order Extra
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36. Agenda
Supply Chain Insights LLC Copyright © 2013, p. 36

37. Ability to Use Data Is Top Supply Chain Pain
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38. Variations in Supply Chain Pain by Subgroups
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39. Four in Five Report Having a Formal Supply
Chain Organization
Supply Chain Insights LLC Copyright © 2013, p. 39

40. Respondents Identify an Average of 6 Functions
That Report through the Supply Chain
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